Working Paper

Cross-border Patenting, Globalization, and Development


Abstract: We build a stylized model that captures the relationships between cross-border patenting, globalization, and development. Our theory delivers a gravity equation for cross-border patents. To test the model’s predictions, we compile a new dataset that tracks patents within and between countries and industries, for 1980-2019. The econometric analysis reveals a strong, positive impact of policy and globalization on cross-border patent flows, especially from North to South. A counterfactual welfare analysis suggests that the increase in patent flows from North to South has benefited both regions, with South gaining more than North post-2000, thus lowering real income inequality in the world.

Keywords: cross-border patents; gravity; policy; globalization; development;

JEL Classification: F63; O14; O33; O34;

https://doi.org/10.20955/wp.2023.031

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Provider: Federal Reserve Bank of St. Louis

Part of Series: Working Papers

Publication Date: 2023-12

Number: 2023-031

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